This invention relates generally to the field of mortgages and more specifically to a Management System for the Protection of Mortgage Equity.
Through all of the history of mortgage financing, there were no institutions or instruments that provided protection to the homeowner in case of personal problems or other unforeseen circumstances that made it impossible to maintain the mortgage. The only protection afforded was to the financial institution, not the homeowner, in the form of mortgage insurance. This can be expensive and not available to most homeowners and does little to protect the homeowner from foreclosure due to ultimate default.
Numerous reasons exist that cause default but among them are loss of job, bankruptcy due to health expenses, relocation of job, divorce and death of the major breadwinner. In each situation, the homeowner may be incapable of maintaining mortgage payments, or in the case of leasing, rent payments, which ultimately result in losing the mortgage or lease. This insecurity of payment by the mortgage holder creates not only a problem for the country's economy but also greatly affects other homeowners as the “domino” effect takes hold and numerous properties go into foreclosure.
Prior art systems that sought to alleviate some of these problems include: U.S. Pat. No. 5,644,726 entitled “Method and System implementing a mortgage partnership,” issued Jul. 1, 1997; U.S. Pat. No. 7,315,841 entitled “Mortgage loan and financial services Data processing,” issued Jan. 1, 2008; U.S. Pat. No. 6,012,047 entitled “Reverse Mortgage Processing System;” U.S. Pat. No. 6,609,200 entitled “System for Processing Electronic Mortgage Document” and U.S. Pat. No. 6,594,633 entitled “Real Estate Computer Network.” None of these prior art systems teach the benefits and advantages of the present invention.
This process and method of the present invention provides insurance and a solution for home owners and prospective home owners who want to join a Home Owner Club by buying or leasing a home, condominium, townhouse or other dwelling. The present invention can also be applied to commercial properties and building. By pooling a group of homeowners and property owners into a unified system, the various dislocations caused by individual failure to meet mortgage payments is smoothed out as a vehicle now exists to resolve the individual problem through a collective mechanism. The present invention relates to a computer system for managing mortgages of large groups of home owners (new mortgages initiation/financing, existing mortgage owners/refinancing and planning to buy a house leasing property occupied) with a no foreclosure rule (taking out of risk and providing an instrument for homeowner to select the right choices in time of foreclosure difficulty to maintain the mortgage payment). It also may help with current government mortgage regulations and laws to lessen the impact of foreclosure type events.
There exists a need for an efficient and comprehensive system for maintaining a large number of mortgages for home owners and flexibility in transferring into a pool those that cannot be maintained, for use or assumption by others. One of the benefits of this invention is that home owners would never face a foreclosure as the collective group would “buy” out their loan, relocate the homeowner and store the property for future use by another member or new member to the club and be an in effect a property manager to facilitate the move to another property or dwelling. In this way, foreclosure to the individual and all of the problems that go with it are largely eliminated.